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INSURERS - Duties - Duty to defend

Friday, May 11, 2018 @ 8:40 AM  


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Appeal by an insurer from an order requiring it to defend the respondents in a personal injury claim. One of the respondents was the driver of an all-terrain vehicle (ATV) involved in an accident on a rural property. A passenger on the ATV sued the respondents. The respondents' automobile insurance policy extended coverage to an ATV if it was owned by the respondents, and the respondents were not occupiers of the property on which the accident occurred. The accident occurred on property that was in the process of being purchased by the respondents. The insurer denied coverage on the basis that the ATV was operated on private property and thus did not fall under the definition of an automobile for insurance purposes. The application judge did not accept the insurer's position and ordered it to defend the underlying action. The insurer appealed.

HELD: Appeal dismissed. The application judge's interpretation of the policy was available on the evidence. The judge gave the pleadings the widest latitude, acknowledging that the statement of claim did not specifically allege that the owner of the ATV and occupier of the property were different people at the time of the accident, but stated that the respondents, and others, occupied the property. Although the pleadings alleged facts that would permit alternative findings on the issue of whether individuals other than the respondents were the occupiers of the rural property at the time of the accident, such allegations were sufficient to trigger the insurer's duty to defend.

Ernst v. Northbridge Personal Insurance Corp., [2018] O.J. No. 1805, Ontario Court of Appeal, C.W. Hourigan, G.I. Pardu and G. Huscroft JJ.A., April 5, 2018. Digest No. TLD-May72018010